Fitch Options sees RBI retaining benchmark rates of interest unchanged throughout the fiscal to March 2022 following its determination to purchase Rs 1 lakh crore of presidency bonds.
“We had initially anticipated one other coverage price reduce to arrest the rise in authorities bond yields for the reason that Union Funds announcement in February.
“Nonetheless, having an express bond buy steering from the RBI following the announcement of the G-SAP may even obtain an identical impact, if not even be simpler than a price reduce on capping the rise in bond yields,” it mentioned in a observe.
The Reserve Financial institution of India (RBI) held its coverage repurchase (repo) price unchanged at 4 per cent at its financial coverage assembly on April 7.
As well as, the RBI introduced a secondary market authorities securities acquisition programme (G-SAP 1.0), committing to purchase as much as Rs 1 lakh crore price of presidency bonds in April-June, taking one other step in the direction of formalising quantitative easing.
“As such, we at Fitch Options have revised our forecast for the RBI to maintain its coverage repurchase (repo) price